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Production License Agreement

Production License Agreement Template for Indonesia

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Key Requirements PROMPT example:

Production License Agreement

"I need a Production License Agreement for my Indonesian pharmaceutical company to manufacture generic diabetes medications under license from a Japanese pharmaceutical company, with production starting in March 2025 and including technology transfer provisions and strict quality control requirements."

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Document background
A Production License Agreement is essential when a company wishes to manufacture products using another company's intellectual property or technology in Indonesia. This document is particularly important given Indonesia's specific regulatory requirements for technology transfer, local content, and industrial licensing. The agreement must comply with various Indonesian laws, including patent legislation, industrial regulations, and investment laws. It typically includes detailed provisions for production specifications, quality control, technical support, and royalty calculations. The Production License Agreement is commonly used in manufacturing arrangements where the licensor provides technology or know-how to an Indonesian manufacturer, or when a foreign company seeks to establish local production operations through a licensed Indonesian partner.
Suggested Sections

1. Parties: Identification of the Licensor and Licensee, including their complete legal details and addresses

2. Background: Context of the agreement, including brief description of the licensed technology/product and parties' authority to enter into the agreement

3. Definitions: Detailed definitions of technical terms, licensed products, territory, and other key terms used in the agreement

4. Grant of License: Scope of the license, including type (exclusive/non-exclusive), territory, and permitted activities

5. Technical Information and Support: Details of technical documentation, know-how, and support to be provided by licensor

6. Production Requirements: Specific requirements for production, quality standards, and production capacity

7. Quality Control: Quality assurance measures, inspection rights, and compliance with standards

8. Intellectual Property Rights: Protection of IP rights, ownership of improvements, and infringement procedures

9. Financial Terms: License fees, royalties, payment terms, and calculation methods

10. Compliance: Compliance with Indonesian laws, regulations, and reporting requirements

11. Term and Termination: Duration of agreement, renewal terms, and termination conditions

12. Dispute Resolution: Governing law, jurisdiction, and dispute resolution procedures under Indonesian law

Optional Sections

1. Environmental Compliance: Required if production involves environmental impacts or hazardous materials

2. Export Controls: Necessary if products may be exported outside Indonesia

3. Training Provisions: Include if technical training is required for production staff

4. Research and Development: Include if parties will collaborate on product improvements

5. Marketing Rights: Include if licensee has rights to market the products

6. Sub-licensing Rights: Include if sub-licensing is permitted

7. Local Content Requirements: Required if subject to Indonesian local content regulations

Suggested Schedules

1. Schedule 1 - Licensed Products: Detailed specifications of products covered by the license

2. Schedule 2 - Technical Specifications: Detailed technical requirements and production specifications

3. Schedule 3 - Quality Standards: Quality control procedures and acceptance criteria

4. Schedule 4 - Royalty Calculations: Detailed method for calculating royalties and examples

5. Schedule 5 - Technical Documentation: List of technical documents to be provided by licensor

6. Appendix A - Production Facility Requirements: Specifications for production facilities and equipment

7. Appendix B - Training Program: Details of technical training program if applicable

8. Appendix C - Reporting Templates: Standard forms for production and sales reporting

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Linkedin in social icon imageX social icon image
alex.den.21@genieai.co
Relevant legal definitions
Agreement
Applicable Laws
Approved Facility
Confidential Information
Effective Date
Force Majeure
Improvements
Indonesian Standards
Initial Term
Know-How
Licensed Products
Licensed Technology
License Fee
Local Content Requirements
Manufacturing Process
Net Sales
Patent Rights
Production Capacity
Production Requirements
Quality Standards
Quarterly Report
Renewal Term
Royalty
Specifications
Technical Documentation
Technical Information
Technical Support
Technology Transfer
Territory
Third Party
Trade Secrets
Trademarks
Working Day
Relevant Industries

Manufacturing

Automotive

Electronics

Pharmaceuticals

Consumer Goods

Industrial Equipment

Food and Beverage

Textiles

Chemical Production

Technology Hardware

Medical Devices

Agricultural Processing

Relevant Teams

Legal

Operations

Manufacturing

Quality Assurance

Research & Development

Compliance

Technical Operations

Intellectual Property

Production

Business Development

Contract Management

Relevant Roles

Chief Technology Officer

Manufacturing Director

Production Manager

Quality Control Manager

Legal Counsel

Intellectual Property Manager

Operations Director

Compliance Officer

Technical Director

Business Development Manager

Contract Manager

Chief Operating Officer

Licensing Manager

Factory Manager

Industries
Law No. 13 of 2016 on Patents: Governs patent rights, licensing, and technology transfer arrangements in Indonesia, crucial for production licensing agreements
Law No. 20 of 2016 on Trademarks and Geographical Indications: Regulates trademark licensing and usage rights in production contexts
Law No. 25 of 2007 on Investment: Provides framework for foreign and domestic investment in production facilities and licensing arrangements
Law No. 3 of 2014 on Industry: Sets out the primary framework for industrial activities and production in Indonesia
Law No. 13 of 2003 on Manpower: Governs labor relationships and working conditions in production facilities
Government Regulation No. 24 of 2018 on Electronic Integrated Business Licensing Services: Regulates business licensing procedures including production-related permits
Law No. 32 of 2009 on Environmental Protection and Management: Establishes environmental compliance requirements for production activities
Law No. 40 of 2007 on Limited Liability Companies: Provides legal framework for company operations and corporate governance in Indonesia
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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